Fri 20 Apr 2018, 08:56 GMT

Oil and fuel oil hedging market update


By the Oil Desk at Freight Investor Services.



Commentary

Brent closed last night up $0.40 to $73.78, and WTI closed at $68.29, down $0.18. What has the week brought us? Another beaut of a week if you're a bull (any bears out there? no? just my colleague? OK then). Since April fool's day, Brent is up 9%. Impressive. I read that crude stocks have finally reached the 5-year average. Hang on a minute, the whole reason the oil market collapsed when news of the "glut" came about was because there was so much oil compared to previous years. So, if oil stocks have finally reached levels compared to the 5-year average, then how is it a good thing? Let me put it this way: Say 5 years ago I weighed 80kg, 5 years later I weigh 160kg, but during the last year I have managed to lose 2kg, ss that 2kg something to be happy about? No, I'm still as fat as an orca and I need one of those stair lifts just so I can go to bed. Like I said yesterday, none of it really matters. All that matters is that OPEC are high-fiving each other about reaching this milestone and the bulls concede, roll over, have their tummy tickled and buy as much as they can accordingly. I will acknowledge (if Goldman's are to be believed that is) that demand does look rather good. It also looks like scrubbers are not going to be as successful an option as some had hoped, with fewer than 1,100 ships likely to have them installed by 2020.

Fuel Oil Market (April 19)

The front crack opened at -13.25, weakening to -13.55 across the day. The Cal 19 was valued at -14.90. Asia's front-month high-sulphur fuel oil crack widened its discount to Brent crude on Thursday, falling to the widest discount since August 2016 amid the rise in crude prices.

The May 180 cSt fuel oil crack to Brent settled at minus $9.64 a barrel on Thursday, down 72 cents a barrel from the previous session.

Sing weekly onshore fuel oil inventories fell 9%, or 1.751 million barrels, to a more-than-10-month low of 17.941 million barrels in the week ended April 18.

China's fuel oil output in March fell 10 percent from the same time last year to 1.98 million tonnes, according to the National Statistical Bureau on Thursday.

Economic Data and Events

* 6pm: Baker Hughes rig count

* ~630m: ICE wkly commitments of traders report for Brent, gasoil

* Commodity Futures Trading Commission weekly scheduled report on futures and options positions

* OPEC's Joint Ministerial Monitoring Committee meets in Jeddah, Saudi Arabia

* Russia 10-day Urals program for May

Singapore 380 cSt

May18 -391.25 / 393.25

Jun18 -390.25 / 392.25

Jul18 - 388.75 / 390.75

Aug18 - 387.25 / 389.25

Sep18 - 385.25 / 387.25

Oct18 - 383.25 / 385.25

Q3-18 - 387.25 / 389.25

Q4-18 - 380.75 / 382.75

Q1-19 -372.00 / 374.50

Q2-19 - 364.75 / 367.25

CAL19 - 345.50 / 348.50

CAL20 - 280.50 / 285.50

Singapore 180 cSt

May18 - 402.25 / 404.25

Jun18 - 401.25 / 403.25

Jul18 - 399.75 / 401.75

Aug18 - 398.25 / 400.25

Sep18 - 396.25 / 398.25

Oct18 - 394.25 / 396.25

Q3-18 - 398.25 / 400.25

Q4-18 - 391.75 / 393.75

Q1-19 - 383.25 / 385.75

Q2-19 - 377.25 / 379.75

CAL19 - 360.50 / 363.50

CAL20 - 304.50 / 309.50

Rotterdam Barges

May18 378.25 / 380.25

Jun18 377.75 / 379.75

Jul18 376.25 / 378.25

Aug18 374.25 / 376.25

Sep18 371.50 / 373.50

Oct18 - 368.25 / 370.25

Q3-18 374.00 / 376.00

Q4-18 364.50 / 366.50

Q1-19 3356.25 / 358.75

Q2-18 347.25 / 349.75

CAL19 326.00 / 329.00

CAL20 262.00 / 267.00


MAmmoSS graphic. Mitsubishi Shipbuilding receives order for ammonia fuel handling system  

MAmmoSS system will support shop testing of ammonia marine engines from two licensors.

Neoliner Origin vessel. Kongsberg Maritime to lead EU Horizon project targeting wind-assisted propulsion at scale  

A 15-partner European consortium will use two full-scale vessel demonstrators to validate wind propulsion technology.

Petrobras logo. Petrobras warns of extended MGO and VLSFO supply suspension at Port of Itaqui  

Fuel distributor announces pipeline maintenance shutdowns affecting both MGO and VLSFO supply.

Richard Berkling, PowerCell Group. PowerCell secures SEK 50m marine fuel cell order for two liquid hydrogen cargo ships  

Swedish fuel cell maker wins contract to power two North Sea hydrogen vessels by 2028.

Wärtsilä hydrogen engine. MatH2 consortium launched to tackle hydrogen materials barriers  

New Finnish-led alliance targets materials compatibility challenges holding back hydrogen adoption.

CMA CGM Berenice vessel. CMA CGM takes delivery of fifth methanol dual-fuel boxship in series from Jiangnan Shipyard  

15,000-teu vessel is the penultimate ship in a six-vessel series due for completion in September.

VeriSphere logo. VPS launches VeriSphere Webshop in push to digitise marine fuel services  

Veritas Petroleum Services unveils self-service digital platform giving customers direct access to fuel data tools.

Titus vessel. ExxonMobil and Wallenius Wilhelmsen complete first trial of biofuel blend made from FAME distillation residue  

Vehicle carrier bunkered in Zeebrugge with B30 VLSFO blend.

Chimbusco and Shenergy green methanol agreement signing. 'China’s largest single-order green methanol procurement deal' announced  

Chimbusco and Shenergy seal agreement for 6,000 tonnes of methanol.

Moriond vessel. Exmar takes delivery of third dual-fuel LPG midsize gas carrier in newbuild programme  

Belgian shipping group Exmar takes delivery of the 41,000-cbm LPG carrier Moriond.